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PM’s bold measures to revive the economy could herald his finest hour in office

Will sound economics – which is what the slew of much-delayed measures announced by the government to boost investors’ confidence amounts to – also prove to be sound politics?

One answer to the question should come with the way the government has dealt with Mamata Banerjee’s ultimatum. If it continues to remain firm as it has in its dealings with her, it will signal the strength of its resolve to risk its survival in office to uphold the national interest. That, in turn, will stymie to some extent the efforts of other parties to push UPA-II to the wall. The SP, in particular, will then think twice before it lets its increasingly strident rhetoric against the Congress reach a point of no return.

Even more significantly, the BJP, which championed reforms when it was in power but has now become the pied-piper of a no-holds-barred popu-lism, will find it hard to sustain its fierce opposition to the government. As it is, the party’s endeavour to paralyse Parliament hasn’t gone down too well even in those sections of opinion that have been outraged by ‘Coalgate’ and other scams that have dented the reputation of UPA-II – possibly beyond repair.

But if the government manages to ensure that the SP does not abandon it, the BJP will be in a tight spot. In fact, it will face a worse prospect should some of its allies – such as the Akalis – break ranks with it on the latest reforms package, not least because it allows states to fashion their own policies as regards FDI in multi-brand retail. This move is very much in keeping with the more pronounced, and growing, federal sentiment in the country.

Fortune, they say, favours the brave. Battered by negative publicity at home and abroad, Prime Minister Manmohan Singh has run a political risk that bears the cachet not only of courage but also of bravado. He took that risk when, in the face of stiff opposition from the CPM, he pushed through the Indo-US civilian nuclear deal. The CPM that had to eat crow. This time the risk is, if anything, more severe since the new measures announced are bound to adversely impact public opinion directly, at least in the short term. And the short term more or less coincides with the time that is left before general elections are held in 2014.

For a prime minister who is cautious to a fault, such risk-taking must surely be rooted in hard-headed calculations. With the elevation of Pranab Mukherjee to Rashtrapati Bhavan, he was able to get out of his way an opponent of the so-called trickle-down theory. With P Chidambaram’s re-induction in the finance ministry he was able to neutralise, in a manner of speaking, A K Antony, another cabinet colleague whose enthusiasm for the reformist agenda has been less than lukewarm. Chidambaram not only backs reforms to the hilt but he also shares, much like Antony does, an excellent rapport with Sonia Gandhi. So it stands to reason that the Congress president, despite her soft corner for the anti-market civil society acti-vists, has lent her full support to the measures recently announced regardless of their political consequences.

Armed with the backing of his cabinet and that of his party’s leadership, the prime minister made bold to take the steps he has taken. That such boldness wasn’t expected of Singh shows the extent to which analysts have underestimated his ability and willingness to rise to the occasion. His silence is misunder-stood as inaction; his words often fail to inspire. But when he acts on the strength of the policies he believes in with the requisite amount of tact and discretion, he makes a mark.

The policies include not just economic reforms but also mending fences with neighbouring countries, particularly Pakistan, and deepening mutually beneficial ties with major players on the international scene. In the bargain, he manages to keep one eye firmly fixed on the government completing its full term in order to enhance the electoral prospects of the Congress party in the next general elections. And the other eye is on the legacy that he will leave behind.

Each one of the measures announced over the past few days is thus a pointer to a dramatic change in the prime minister’s approach to governance. He has, to put it plainly, begun to overcome the fear of fear. If he continues on this trajectory and finds ways – ordinances? – to usher in other reforms stuck in Parliament, especially the ones related to curbing corruption, there are good reasons to believe that the negative public perception of his government will gradually take a turn for the better.

But on one condition: no compromise in the face of pressures from recalcitrant allies, from an opposition that is yet to get its act toge-ther and, no less important, from shady figures in his own party who cut unsavoury deals ostensibly to fill the coffers of the Congress. This could then be the advent of Manmohan Singh’s finest hour in office.